By: Lucinda McCann and Amanda Velonis
A Senate Inquiry into the performance of the Australian
Securities and Investments Commission (ASIC) has been prompted by
concerns about ASIC's handling of certain potential risk and
compliance management issues arising in relation to Commonwealth
Financial Planning Limited (CFP).
Whilst the terms of reference of the Inquiry were wide, the two
main issues that arose in relation to CFP were:
- the lengthy delay between ASIC becoming aware of the potential
issues and taking enforcement action
- the appropriateness of enforceable undertakings (EUs) as a
regulatory tool in all circumstances: that is, whether EUs allow a
regulated party to negotiate an outcome with ASIC that may have few
specific or general deterrent effects, when contrasted with
alternative courses of regulatory action such as court, civil,
administrative or infringement action.
